An Iranian worshiper holds portraits of Iran's Supreme Leader Ayatollah Ali Khamenei . In an official complaint sent to UN chief Ban Ki-Moon late Tuesday, Iran rejected allegations of an assassination plot in the US, blaming them on "the current US warmongering and propaganda machine against Iran," which yielded an "evil plot" to "divert attention" from American problems at home.

Istanbul, Turkey — Iran has expressed outrage at charges by the US that it was behind a plot to assassinate the top Saudi Arabian diplomat in Washington and bomb Israeli and Saudi embassies on US soil.

US court documents unsealed on Tuesday allege that Iranian agents from the Qods Force, a specialist branch of the Revolutionary Guard, sought to hire hit men from a Mexican drug cartel. But Iran is quickly countering with its own narrative that Washington is desperate to distract attention from severe economic problems, and what Iran calls the spreading "awakening" of American citizens manifested in the Occupy Wall Street protests.

"No doubt this is a new American-Zionist plot to divert the public opinion from the crisis Obama is grappling with," the chairman of Iran's National Security and Foreign Policy committee in parliament, Alaeddin Boroujerdi, said on Wednesday.

"Americans are seeking to derail the public opinion from the Wall Street uprising," said Mr. Boroujerdi, according to Fars News Agency, which is linked to the Revolutionary Guard. Iran "has never pursued or adopted the policy of assassination, and it rather is a victim of terrorism. Therefore, the US officials' allegation is nothing but a big lie."

Khamenei describes an America in decline

Many questions remain about the true facts behind the case, how serious and dangerous it really was, and how much Iranian government involvement may have been a factor – if at all – despite US Justice Department claims that the plot was "conceived, sponsored and was directed from Iran."

Iranian agents killed scores of regime opponents in the 1980s and 1990s, mostly in Europe and Iraq, in a practice that was largely stopped by the time reformist President Mohammad Khatami was elected in 1997.

In an official complaint sent to United Nations chief Ban Ki-Moon late Tuesday, Iran rejected the new allegations, blaming them on "the current US warmongering and propaganda machine against Iran," which yielded an "evil plot" to "divert attention" from American problems at home.

Those problems are corrosive – the start of a broader Western collapse – according to Iran's supreme religious leader Ayatollah Seyyed Ali Khamenei, who on Wednesday addressed a large rally in the western Iranian city of Kermanshah.

Ayatollah Khamenei did not directly address the murder plot charges. But he painted a gleaming picture of the Islamic Republic on the rise – and its enemies in the West in decline.

That calculation may not match those of most Iran experts, but a very discernible flash of joy crossed Khamenei's face when he began speaking about the Occupy Wall Street "movement."

"The people of America are excited, they are out on the street, that is important," Khamenei said, according to a simultaneous translation on state-run PressTV. The US government "wants to undermine this, to downplay this, and they are trying hard still to do that."

"One day, this movement will be boasting of itself, it will totally rock and destroy the capitalist system," predicted Khamenei, as a news ticker at the bottom of the screen stated that the "Anti Wall Street campaign spreads to over 1,400 towns and cities across US," and that protesters in New York now "march on US billionaires' homes."

Khamenei noted banners in the US protests saying that, "We are the 99 percent."

"That means the majority, the 99 percent of the American population, are condemned by 1 percent," averred Khamenei. "The wars in Iraq and Afghanistan were launched by those 1 percent, but the damages are incurred by the 99 percent. This is how the people in America were awakened."

"Of course there [is] propaganda warfare and psychological warfare by American officials and the CIA," Khamenei added. "They are really forceful and powerful and may overcome these movements, but the fact of the matter is out there ... this is the Western liberal democracy with all those false claims."

A pretense for new security measures?

Others in Iran connected the dots between the murder plot allegations and their reading of a US demise, and even tried to account for its timing.

Fars News Agency said US officials and media had "started staging a new scenario against Tehran" to divert global attention from "uprisings in the US" and across the Middle East, and to "launch a new wave of security measures in the US."

Fars stated that historically the US would "launch psychological operations against Washington's foes in sensitive junctures," and that today it had a host of reasons for this "new puppet show," from stepping up pressure on Iran in nuclear talks to hiding the "massacre" of protesters by US allies in the Middle East.

The worldview of Fars: "This new act can help the White House to start a new wave of security measures across the US ... to better clamp down on Wall Street protests which have overwhelmed the country."